In Case You Missed This, and I Did,

60 Minutes had a report on the latest "housing shock":




I used to be pissed off at Scott Pelley because of his hack reporting of the Clinton years, but he's redeemed himself a lot with these reports on the worsening economy.

With Foreclosures and Housing Prices Dropping,

you'd think it would be a good time to buy, provided you pay cash and not go on a mortgage.  Unfortunately, so many people are jobless or are not seeing their income improve, they can't take advantage of it.

In the end, the handful of rich will own all the property in this country, and we will be right back to the dark or middle ages with feudalism.

We will all be renters and slaving away until we die.

News, Etc.

The foreclosure scandal promises to get bigger now that Nancy Pelosi has stepped up to the plate.
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Veteran, older teachers (read MORE expensive) are about to get fucked over by L.A. Unified.
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Too little, too late,  Barry.

Home Sales

are now shot to shit as fewer people can afford even the fire-sale prices of real estate.

All of it is by design, of course.

The Housing Crisis,

like the jobs crisis, continues to get worse, but naturally our elected officials will do little about it.

What is Happening in Vegas, Unfortunately,

isn't staying there.

Reno, for example, is increasingly turning into a ghost town. People are leaving here in droves.

In my neighborhood, which is considered more low income than many, "For Rent" signs are everywhere. Few people are moving in.

Economy and Housing

In Nevada, many people really have nothing to their names when it comes to their mortgages, as they have negative equity and will not benefit from any federal help.

This particular study focuses on Las Vegas, where 60 percent of "homeowners" have negative equity. They are really no better off than renters and probably worse off.

I think one can reasonably assume this negative equity is rampant all over the country now that housing prices have plummeted.

Obama

wants to help alleviate the foreclosure crisis, but is it enough?

All of these things he's trying to do are well meaning, but there needs to be a halt to the upward distribution of wealth which is destroying everybody underneath, and a complete reversal of tax policy heavily benefiting the rich. As I said, tax rates need to go back to 1950s levels, combined with strict regulations and penalties on companies which outsource jobs and universal health care, and the economic problems would reverse very quickly.

It's political will that is the problem. We have all of these legislators who are on the take from the same financial and corporate interests, and they are afraid of losing contributions if they do the right thing.

The Housing Mess

It really WAS Bush's fault the housing industry went into the shitter, and with it the economy.

He was another of those Friedmanite cultists, and we are now all paying the price with that crap. He wanted to expand "home ownership," which really meant more people would be more in debt than ever, people who shouldn't have "bought" houses in the first place, even if that meant high-risk practices which created a house of cards sure to collapse.

The Booming Economy

There were 159,000 job cuts last month.


It is utter bullshit to argue, as Republicans do, that the Community Reinvestment Act of 1977 was responsible for the housing mess. They are cynically trying to blame blacks and even Bill Clinton for the problem THEY and their economic religion created.

It's deregulation that's the problem. It's Friedmanomics that is the problem. Milton Friedman was a crackpot whose economic theories should have been laughed out of every tenth-rate college in the United States. Instead, his and his fellow Chicago School crackpots were lionized by politicians of both political parties, especially the Republicans, and in other countries, and with ruinous results.

Friedmanomics needs to go in the trash can where it belongs.

(H/T to Cannonfire)

The Booming Economy.

Now that the cost of housing has deflated dramatically, one can almost afford to live in the Bay Area.

The Booming Economy Casualty List for 12/20-12/27.

U.S. housing takes a record dive.

The Booming Economy Casualty List for 11/23-12/7.

The collapse of the California housing market is indicative of the worsening economic inequality in this country:

Assuming that it can actually be enforced, this is a half measure that only postpones the day of reckoning for homeowners. Those homeowners with negative amortization loans are courting much worse financial disaster 5 or 7 years from now if these measures were to include them, having to make payments on a ballooning principal, the result of seven years of partially postponed payments.

For the first time since the Great Depression thousands of California’s families—and many more throughout the United States—are losing their homes, left standing on the courthouse steps while the fruit of their hard work is auctioned off. What should be the democratic right of every family to decent shelter is sacrificed to the profit needs of banks and financial institutions.

I am glad I am a renter right now.

Our dictator, however, is up to no good on this matter.

And if this ain't 1929, it's about the closest thing to it:

Stick with me now, because this is where it gets interesting. For it is at this point that the banks got the bright idea of buying up a bunch of mezzanine tranches from various pools. Then, using fancy computer models, they convinced themselves and the rating agencies that by repeating the same "tranching" process, they could use these mezzanine-rated assets to create a new set of securities -- some of them junk, some mezzanine, but the bulk of them with the AAA ratings more investors desired.

It was a marvelous piece of financial alchemy, one that made Wall Street banks and the ratings agencies billions of dollars in fees. And because so much borrowed money was used -- in buying the original mortgages, buying the tranches for the CDOs and then in buying the tranches of the CDOs -- the whole thing was so highly leveraged that the returns, at least on paper, were very attractive. No wonder they were snatched up by British hedge funds, German savings banks, oil-rich Norwegian villages and Florida pension funds.

And there's more in that column.

And there is still more.

The Bush Administration

is trying to get a handle on the mortgage mess by probably making it worse.

Paul Krugman has more about the mess we are in.

How did the

housing market get so bad?

Easy credit for high-risk buyers, greed for more profits. It's very simple.

The Booming Economy Casualty List for 11/2-11/9.

This kind of crap scares me.
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It's time to ask the rude question of whether California is producing more attorneys than it needs.

The same question can be asked about college graduates nationwide.
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